Eddie Stobart Logistics (ESL) was spun out from the larger Stobart Group (STOB) to reduce its debt and further its acquisitive growth strategy. Joining Aim in April this year helped fund its £45m takeover of e-commerce logistics specialist iForce. After the period-end, ESL took a 50 per cent stake in business-to-businesss specialist Speedy Freight. Chief executive Alex Laffey – who has been with the company since 2015 – says future acquisitions are on the cards, although most announced deals have been “in the works for some time”.
The advantage of these transactions, in Mr Laffey’s view, isn’t limited to cross-selling opportunities or cost synergies. These deals bring with them “a strong contracted customer base”, he says. Although these numbers only include a small contribution from iForce, the business is trading in line with management’s expectations.
Group profitability was dented by one-off IPO-related expenses, although revenue on an underlying basis rose by a solid 13 per cent. This reflected revenue growth across the manufacturing, industrial and bulk segment of 22 per cent, and 51 per cent in e-commerce contracts.
Analysts at Cenkos expect pre-tax profit of £41.3m for the year ending November 2017, giving EPS of 11p, compared with £25.6m and 10.9p in FY2016.
| EDDIE STOBART LOGISTICS (ESL) | ||||
| ORD PRICE: | 159p | MARKET VALUE: | £567m | |
| TOUCH: | 158-159p | 12-MONTH HIGH: | 164p | LOW: 156p |
| DIVIDEND YIELD: | 0.9% | PE RATIO: | na | |
| NET ASSET VALUE: | 57p* | NET DEBT: | 47% | |
| Half-year to 30 June | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2016** | 266 | 1.7 | 0.5 | nil |
| 2017** | 287 | -7.6 | -2.5 | 1.40 |
| % change | +8 | - | - | - |
| Ex-div: | 7 Sep | |||
| Payment: | 20 Oct | |||
| *Includes intangible assets of £258m, or 72p a share**Company admitted to Aim in April 2017 | ||||
